Introduction:
The evolution of software has had a remarkable journey post-Agile's intervention. We can understand Agile more as a mindset than just a methodology. Organizations that have religiously followed the core values of agile have immensely profited from its flexibility, adaptability, scalability, and productivity. The state of agile adoption is determined by observing to what extent agile is adopted, the reasons behind adopting it, and the benefits it promises to offer.
The 16th Annual State of Agile Report looks deeper into the enterprise and observes which agile techniques have these enterprises implemented and how have they benefitted. It also explains what works, what doesn't, and what challenges and opportunities they encountered using the Agile methodology.
The report is based on the input of over 3,220 professionals from the business and IT sectors worldwide, who come from various industries and roles. In addition, it is worth noting that this is the most extensive and longest-running survey to date, with input from approximately 40,000 Agile executives, consultants, and practitioners.
The following are the Key Points discussed in the Report:
Go-to Approach for Enterprises:
According to 89% of respondents, high-performing Agile teams have people-centric values, clear culture, tools, and leadership empowerment. This proves the point that if agile is effectively executed its benefits are not only enjoyed by the individual but also by the organization. Such a compelling incentive is irrefutable and encourages organizations to invest in agile. Process plays a prominent role in bringing changes. Traditionally, companies focus on achieving one of the following: increasing revenue, reducing costs, or cutting expenses.
Implementing Agile Practices:
The ability to move swiftly without compromising on predictability offers a key benefit and stands out from various other benefits, such as the previously mentioned revenue and cost drivers. Whereas, 44% of respondents expressed that they chose agile for its delivery predictability, and 31% of respondents chose the same to lower the risk.
Factors influencing Agile Adoption:
When respondents were asked to justify their reasons for shifting towards agile practices, 13% of respondents indicated that they were using Agile practices for IT and Software development teams, whereas 26% used it for company-wide digital transformation. While 61% of respondents chose both options.
Measurability:
On-time Delivery is the primary objective of agile practices that focus on IT and software development teams. Therefore we see 47% of Agile teams are measured by on-time delivery. 44% of Agile teams are measured by Business Objectives Achieved, which is closely linked to Digital Transformation.
Priority:
After their responses about measurability, they were asked how they prioritize their work on application development and delivery. 54% Prioritize Company Goals, 43% Prioritize End Customer Satisfaction and 35% Prioritize by Time to Deliver. This indicates that the primary importance is given to the company's and stakeholders' goals ahead of delivery time.
Rise in Agile Adoption
Agile adoption is not just confined to software or IT development it further extends to cross-functional teams across lifecycles. It has now encompassed other areas such as HR and marketing. In this survey, after enquiring about the product or application owners (36%), and engineering or R&D (32%), they found a significant rise in adoption rates within the organizations. Let us look at this trend further.
Even though the number has slightly lowered compared to last year, still 80% of them are using Agile as their predominant approach. However, what makes a noteworthy point is that 50% of them were using a combination of agile, waterfall, or iterative.
In response to the point of using Agile in conjunction with other methodologies like a waterfall or iterative, the survey found that 25% say the combination framework works well for them. 48% say that it is moderately effective and 27% say that it is not effective at all. These figures leave room for improvement. It shows not all businesses are thoroughly satisfied with agile practices. Over 7 in 10 respondents say they are satisfied with the Agile practices in their company, half are somewhat satisfied and one in five very satisfied.
What is Working Well Across Agile Practices, People, and Technology
During this survey, when respondents were asked about the best practices of Agile they mentioned increased collaboration (69%) as the first and foremost practice from which they derived the utmost satisfaction. Next to collaboration comes better alignment with business needs (54%) followed by a better work environment (39%) and increased visibility in the application development cycle (37%). This resonates with the previously stated point that high-performing Agile teams that follow people-centric values, clear culture, tools, and leadership empowerment benefit the most.
Since most teams were being measured by aligning the business needs they were asked deeper questions about what exactly they were doing to measure alignment to business needs.
The initial set of responses includes business metrics in general, along with surveys or metrics linked to specific projects. 39% of the responses pertained to business metrics, 30% were related to end-user or customer surveys, and the remaining 30% were individual project metrics.
The next set of responses is related to metrics that are more closely aligned with OKRs, NPS scores, or value stream KPIs, i.e. 27% - OKRs tied to Epics; 25% - NPS scores, and 25% - value stream KPI.
The last category of metrics, which is less commonly used, consists of more basic IT metrics (20%), flow metrics (17%), or DORA (4%). While these metrics can be used to measure the software development cycle, they are not found to be effective in aligning team efforts with business objectives.
Trending Tools and Technology in Agile Adoption
In comparison to the 15th year, the percentage of respondents utilizing Atlassian's Jira Align software remained steady, despite a drop from 72% to an unspecified number. On the other hand, Microsoft Excel usage decreased from 45% to 34% this year, and the combined utilization of Microsoft TFS/Azure DevOps/Visual Studio fell from 42% to 23% this year.
Agile Methodologies
Looking at methodologies, almost 9 in 10 respondents are currently leveraging Scrum while over half are currently leveraging Kanban.
The survey denotes the significant changes that have taken place over the last 3 years in the utilization of various methodologies. Scrum continues to lead, with a notable increase from 58% in the 14th survey to 87% in the current survey. A rocketing increase is noticeable in the use of Kanban from 7% in the 14th survey to 56% in the current survey. Scrumban has modestly grown from 10% in the 14th survey to 27% in the current survey. Iterative has also grown from 4% in the 14th survey to 20% in this year's survey.
The most popular framework continues to be the Scaled Agile Framework (SAFe). Around 53% of respondents expressed that they are currently using the SAFe framework for Enterprise Agile while 28% were using Scrum@Scale/Scrum of Scrums.
Challenges in Agile Adoption
As organizations scale, Agile practices to other areas of business such as Engineering, Business Operations, HR, or Marketing, are likely to face challenges. According to the survey the barriers that hinder adopting Agile on the business side of the organization are lack of leadership participation (42%), inadequate knowledge about Agile (40%), general organizational resistance to change (40%), and insufficient management support and/or sponsorship (39%).
In addition to limited Agile leadership, company culture is another challenge that needs attention. 40% are dissatisfied with Agile in their organization due to the frequent clash between Agile practices and company culture. In fact, company culture is identified as the leading "cause of unsuccessful delivery with Agile".
The survey results highlight areas of opportunity, especially in education and alignment. Nearly 1 in 5 respondents (19%) were unsure about how to measure alignment to business needs, indicating a need for leadership to understand Agile and help teams align to business goals. Executive support is also critical with 38% reporting "Lack of management support" as a major cause of unsuccessful delivery with Agile, while two in five respondents say lack of leadership participation is a barrier to adopting Agile.
The survey also revealed that many organizations have tools that historically support a waterfall or an iterative approach, which makes it challenging in shifting to a completely Agile approach. Although 80% of respondents are using Agile, half are using hybrid – a combination of Agile, waterfall, or iterative methods - in addition to Agile. Another third state that their Agile is a combination of various Agile frameworks. About 42% reported that their company has many legacy systems that require a mixed approach. And 40% reported that there were inconsistencies in the practices of Agile across teams. Applying a combination of methodologies to manage heterogeneous technologies will only aggravate inconsistency.
Conclusion
Based on these statistics, it is evident that Agile methodology is widely adopted in Software/ IT sector and is gradually making its way into other organizations, promising significant benefits. Nevertheless, there is still ample opportunity for improvement in various sectors, and it is the responsibility of organizations to determine which strategies are most effective for software delivery and other areas of their businesses to take advantage of them and achieve optimal results.
